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India mulls night-time ban of fuel sales

During the global recession, developing economies such as India’s seem to have been the exception to a world-wide downturn. However, now even booming economies are facing their demons, as demand for energy to fuel the grow becomes an increasingly contentious issue.

A petrol station in New Delhi, India-could it and others like it be closed at night to reduce the country's fuel use?

India’s government is growing increasingly concerned about the cost of oil imports to the country and their significant part in the widening of the country’s account deficit.

According to the BBC this morning, the government is considering a number of solutions to reduce fuel use including banning night-time sales at petrol stations. 

With a goal of cutting fuel demand by 3 per cent, the Press Trust of India (PTI) news agency estimates that such efforts could help the country save around 160bn rupees (£1.6bn) in foreign exchange outflow from the country.

Oil Minister, Veerappa Moily told the news agency: "There are various options and ideas that have been floated.

"Shutting petrol pumps during night is one of them. But we have not decided. It is just a proposal," he added.

India’s deficit hit a record high of 6.7 per cent of gross domestic product (GDP) last year, promoting policymakers to seek ways to reduce it.

A deficit occurs when the country’s import bill exceeds its earning from exports, putting a strain on foreign exchange reserves. 

A decline of India’s currency against the dollar, reducing almost 20 per cent this year, worsened the situation.

However not everyone thinks a night-time closing of fuel stations will be an effective way to reduce the country’s thirst for oil, as car ownership levels continue to rise.

India’s main opposition party, Bharatiya Janata Party (BJP) labelled the idea a ‘strange move’ according to PTI.

Currently, India imports nearly 80 per cent of its fuel needs. The Government subsidies fuels including, diesel and cooking gas, to help the poorest and to control inflation.

However, the subsidies are also contributing to a growing deficit, prompting calls for a cull of them, especially as some believe that they don’t actually help the poor but are just there to keep the middle classes happy.

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Faye Sunderland

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